HIDDEN COSTS Export financing can pay for itself in countries where the export climate is favorable. In some countries such as China, where the economics currently work against U.S. exporters. U.S. exporters are at a disadvantage.

Taiwan: Washington’s Neglected Partner in the Pacific

The Only Chinese-Speaking Democracy Can Help the US Challenge China

CHINA, TAIWAN: Beijing has been taking aim at Taipei economically, militarily, and diplomatically.

Sharelines

China is challenging “American power, influence, and interests, attempting to erode American security and prosperity.”

Taiwan can play a key role in the Trump administration’s concept of a Free and Open Indo-Pacific.

Trump’s stated policy is to curb Chinese power, but his actions have been all over the place.

President Donald Trump’s National Security Strategy states that China is challenging “American power, influence, and interests, attempting to erode American security and prosperity.”

There are several aspects to this phenomenon. One is Beijing’s expanding military presence in the South China Sea. Another is its effort to expand influence across Asia and Europe with its Belt and Road initiative. Yet another is to put the squeeze on Taiwan, the world’s only Chinese-speaking democracy.

Since 2016, Beijing has been “taking aim at Taiwan economically, militarily, and diplomatically,” according to a recent report from the American Enterprise Institute. It has curtailed Chinese tourism to Taiwan and the ability of Taiwanese companies to do business on the mainland. China has also attempted to isolate Taiwan diplomatically by, among other things, blocking Taiwan from observer status at international organizations.

Although the Trump administration has stated its policy of curbing Chinese power, its actions have been all over the place, and this has been exacerbated by the failure of fill a number of key policy positions in the State and Defense departments.

According to the AEI report, Taiwan could play a role in the administration’s efforts to rein China in. Taiwan is the tenth-largest trading partner of the US, and could be given priority in the administration’s regional trade agenda. “Taiwan had hoped eventually to join the Trans-Pacific Partnership (TPP),” the report noted. “However, with the president opting out of TPP for now, advances in the US-Taiwan economic relationship appear uncertain.” Taiwan was not exempted from Trump’s tariffs on steel and aluminum, a counterproductive development, according to the report.

Taiwan “could be an economic and strategic partner for the United States in the region,” according to the report. “There is unfulfilled potential in the relationship…”

The administration could, for example, take advantage of the Taiwan Travel Act, which allows higher-level government and military officials to visit Taiwan. This year’s defense authorization bill calls for strengthened ties with the Taiwanese military.

“For far too long, one administration after another has fallen short of the policy mandates laid out in the 1979 Taiwan Relations Act,” the report stated, “which declared peace in the Taiwan Strait to be a US national interest and called for maintaining close relations with the people of Taiwan.

“There is an opportunity at hand to reverse course,” the report concluded. “Taiwan can play a key role in the Trump administration’s concept of a Free and Open Indo-Pacific.”